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FEDERAL RESERVE BANK OF DALLAS
F IS C A L A G E N T O F T H E U N IT E D S T A T E S

Dallas, Texas, July 27, 1966

PRELIMINARY ANNOUNCEMENT
EXCHANGE OFFERING
To All Banking Institutions and Others Concerned
in the Eleventh Federal Reserve District:

There is quoted below a press statement issued today by the Treasury Department in regard to current
financing:
Treasury Announces $14.9 Billion Refunding
The Treasury today announced that it is offering holders of the note and bond issues maturing
August 15, 1966, and the certificate, note and bond issues maturing November 15, 1966, an opportunity
to exchange their holdings at attractive yields.
The securities eligible for exchange and those being offered are as follows:
Securities Eligible for Exchange
and their M aturity Dates

4%
3%

notes, A-1966
bonds, 1966

8 /1 5 /6 6
8 /1 5 /6 6

Securities Offered in Exchange
and their M aturity Dates

51/4% ctfs., A-1967 8 /1 5 /6 7
5 V 4 % notes, A -1971 5 /1 5 /7 1

11
jr
Prerefunding

4 % % ctfs., A-1966
notes, E-1966
4%
3 % % bonds, 1966

1 1 /1 5 /6 6
1 1 /1 5 /6 6
1 1 /1 5 /6 6

j

|

5 V 4 % notes, A -1971 5 /1 5 /7 1

1

The new securities are being offered at par to holders of the August maturities, and therefore will
yield 5 Vk%- Details for the November maturities showing cash and interest adjustments appear in
Table 1, and approximate investment yields in Table 2, both tables appearing on the reverse hereof.
The public holds $8.1 billion of the securities eligible for exchange, and about $6.8 billion is held
by Federal Reserve and Government Investment Accounts.
Cash subscriptions for the new securities will not be received.
The books will be open for three days only, on August 1 through August 3, for the receipt of
subscriptions. Subscriptions addressed to a Federal Reserve Bank or Branch, or to the Office of the
Treasurer of the United States, and placed in the mail before midnight, August 3, will be considered
as timely. The payment and delivery date for the new securities will be August 15, 1966. Interest
on the securities maturing November 15, 1966, will be adjusted as of that date. The new certificates
will be made available in bearer form only. The new notes will be made available in registered as well
as bearer form. All subscribers requesting registered notes will be required to furnish appropriate
identifying numbers as required on tax returns and other documents submitted to the Internal Revenue
Service. This is a taxable exchange.
Coupons dated August 15, 1966, on the securities eligible for exchange should be detached and
cashed when due. Coupons dated November 15, 1966, on securities eligible for exchange must be
attached. The August 15, 1966, interest due on registered securities will be paid by issue of interest
checks in regular course to holders of record on July 15, 1966, the date the transfer books closed.
Interest on the 5
certificates will be payable on February 15 and August 15, 1967. Interest
the 5 Vi % notes will be payable on November 15, 1966, and thereafter on M ay 15 and November
until maturity.
The official circulars and subscription forms for the new issues of Treasury notes and certificates
mailed Thursday, July 28; however, if the forms are not received by Wednesday, August 3, subscriptions
entered by mail or telegram, subject to confirmation on official subscription blanks.

on
15
will be
may be

Yours very truly,
Watrous H. Irons
President

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

TABLE No. 1

PAYMENTS DUE TO AND DUE FROM SUBSCRIBERS IN THE AUGUST 1966 PREREFUNDING
(In Dollars Per $100 Face Value)

Securities To Be
Exchanged

Payment By Subscribers
On Account Of Issue Price
Of Offered Securities

Accrued Interest To
August 15, 1966, On
Securities Exchanged
To Be Paid To Subscribers

Net Amount To Be
Paid To Subscribers

For the 5 % % Note 5/15/71
4%%CofI

11/15/66

0.10

1.187500

1.087500

4% Note 11/15/66

0.35

1.000000

0.650000

3% % Bond 1966

0.55

0.843750

0.293750

TABLE No. 2

INVESTMENT RETURNS IN THE AUGUST 1966 PREREFUNDING
Securities Eligible
for Exchange1

Approximate Investment Yield
From 8-15-66 to Maturity2

Approximate Reinvestment Rate
for the Extension Period3

3% % Bond 11/15/66

5.24%

5.23%

4% Note 11/15/66

5.23

5.24

4% % Certificate 11/15/66

5.24

5.26

OFFICE OF THE SECRETARY OF THE TREASURY
OFFICE OF DEBT ANALYSIS
1 Not eligible for nontaxable exchange privilege.
2 Yields to nontaxable holders (or before tax) on issues offered in exchange based on prices of eligible issues (adjusted for
payments on account of issue price). Prices are the mean of bid and ask quotations at noon on July 26, 1966.
3 Rate for nontaxable holder (or before tax).


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102